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Aspects of Contract and Negligence for Business

Paper Type: Free Essay Subject: Law
Wordcount: 3706 words Published: 19th Sep 2017

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There are certain contractual rights and obligations when two parties indulge in a contract. The first two case studies put light on these rights and obligations. Then there are some laws which are applicable when breach of a contract occurs. The next two case studies put light on these laws as breach has occurred and someone has to be sued and someone has to be compensated. These laws contain tort laws and vicarious liability laws. These laws are applicable when negligence has been occurred in the existing contracts.

Learning outcome 1

Task 1

Essential Elements of a Business Contract

Least two gatherings

At least two gatherings are required to enter into a contact. One gathering need to make an offer and other must acknowledge it. The individual who makes the “proposal” or “offer” is known as the “promisor” or ‘offer or’. While, the individual to whom the offer is made is known as the “offeree” and the individual who acknowledges the offer is known as the ‘acceptor’.

Offer and acknowledgement

There must be an “offer” and an “acknowledgement” to the offer, coming about into an understanding. Both offer and acknowledgement ought to be legitimate.

Legitimate commitments

The gatherings must plan to make a lawful obligation. The understanding looked to be upheld ought to mull over lawful relations between the gatherings to it.

Legitimate thought

An agreement is fundamentally a deal between two gatherings, each one getting “something” of worth or profit to them. This “something” is portrayed in law as ‘attention’. Thought is a fundamental component of a substantial contract. It is the cost for which the guarantee of alternate is purchased. An agreement without attention is void. The attention may be as cash, administrations rendered, products traded or an offering which is of worth to the next gathering. This attention may be past, present or future, yet it must be legal.

Skillful gatherings

The gatherings making the agreement must be legitimately equipped as in every must be of the period of larger part, of a sound personality, and not explicitly excluded from contracting. An assertion by awkward gatherings might be a legitimate nullity.

Free assent

The contracting gatherings must give their assent openly. “Assent” implies that the gatherings must concur about the topic of the assertion in the same sense and in the meantime. Agree is said to be free in the event that it is not actuated by pressure, undue impact, fraud, misrepresentation or oversight. The nonappearance of free assent would influence the lawful enforceability of an agreement.

Legitimate item

The object of the understanding must be legal. An understanding is unlawful, in the event that it is:- (i) illicit (ii) corrupt (iii) fake (iv) of a nature that, if allowed, it would overcome the procurements of any law (v) causes harm to the individual or property of an alternate (vi) contradicted to open approach.

Not explicitly pronounced void

An assent ion explicitly announced to be void under the Contract Act or under whatever available law is not enforceable and is, accordingly, not an agreement. The Contract Act announces void certain sorts of assertions, for example, those in limitation of marriage, or exchange, or legitimate transactions and additionally wagering understandings.

Certainty and plausibility of execution

The terms of an agreement should not be obscure or questionable. On the off chance that an assent ion is unclear and its significance can’t be found out, it can’t be upheld. Also, the terms of an agreement must be, for example, are equipped for execution. Consent to do an unthinkable demonstration is void and is not enforceable by law.

Lawful conventions

Generally, an agreement may be oral or in composing. Then again, certain agreement is obliged to be in composing and may even oblige enrollment. Accordingly, where law requires consent to be placed in composing or be enlisted, the same must be agreed to. Case in point, the Indian Trusts Act requires the making of a trust to be lessened to composing.

Types of Business Contract


The two sorts of leases are genuine property leases and gear leases. True property leases, now and then called business leases, include leasing structures, area or other space. Among the contemplations for a business lease are characterizing the premises, characterizing how you can utilize the rented space, whether you or the landowner pays for adjustments and upgrades and all money related issues. A supplies lease may include anything from leasing a copier to an armada of development gear.

Work Related Contracts

Organizations may have contracts with their representatives, for example, a livelihood understanding, job detachment assertion, worker no compete understanding or classifiedness understanding. For non-representatives giving administrations, a business may have an autonomous builder understanding or counseling assertion.

Deals Related Contracts

A bill of offer legitimately exchanges the title of property and is most usually utilized for things, for example, autos and watercrafts. An understanding for the offer of products gives particular data about the merchandise or administrations being sold. A buy request subtle elements the definite merchandise or administrations being obtained. Guarantees are lawful assurances about products or administrations sold. At the point when a business offers great to a purchaser paying in portions, a security assertion gives the business the right to repossess the products if the purchaser doesn’t make installments.

Terms in Contract

The substance of an agreement is known as terms. An assertion will by and large comprise of different terms. Indeed the least difficult types of agreement will have terms.

Terms may be either:

Express terms – those concurred between the gatherings themselves.

Inferred terms – terms which are put into the agreement by the court.

Articulations made throughout the course of transactions could be named either:

  • An express term – if not satisfied the pure party may bring a movement for rupture of agreement.
  • A representation – if not satisfied the pure party may bring a movement for adulteration.
  • As a feature of an insurance contract – the blameless party may sue on the security contract. The principle contract stays in place
  • A deals puff – not expected to be tying. Has no lawful impact. E.g. Red Ball provides for you wings.

Learning Outcome 2

Task 2

Case 1

  1. If we apply the essential elements leading to a contract on case 1, then my analysis will take the following shape.

Elements Leading to Contract

Application on Case 1

  • Minimum two Parties
  • Gordon (Salesman) and Fred (Manager) are the Required Parties here.
  • Offer and Acceptance
  • Fred made an offer to Gordon which was accepted by him.
  • Legal Obligation
  • After the offer was accepted by Gordon, a legal Obligation has been created on both the parties to follow the contractual rules.
  • Free Consent
  • Both the parties agreed to the terms and conditions to their free Consent.
  • Competent Parties
  • Both the parties are of sound age and mind.
  1. Rights and Obligations of the Parties

Gordon who is a salesman has indulged in a Contract with his manager Fred that he will not take his salary for the year 2009, 2010, 2011 and will only rely on the commission that he will be getting from the sales. So after this the right of Gordon is only on the sales commission and his obligation is not to take his three years’ Salary.

Fred has the right to deny his 3 years’ salary if he comes to get it in the contractual period. And he has the obligation to give sales commission to Gordon irrespective of the amount earned.

  1. Terms of Contract

As per the information provided in Case 1, the terms of contract between Gordon and Fred is Express terms. It is because both the parties agreed to the contract on their own consent. Fred as a manager asked Gordon to forgo his 3 years’ salary because of the declining state of the business and Gordon accepted it to boost the performance of the business. Now after the business started growing again Gordon wants his forgone salary to be returned back. But as he was in an agreement with Fred that he will forgo his salary so he will not be able to get it back.

Case 2

My analysis of the case 2 provides the following point

  • It was the right of Janet to be provided phone installation services on the same day as internet installation because it was the obligation of Virgin Media to provide the said services.
  • The services were provided late despite of repeated calls and emails and when the bill came the phone charges were the same as internet and in reality the phone was installed 3 weeks after the internet were installed.
  • The legal Position of Janet is very strong against Virgin Media and Janet should sue the company for their action because on record it is present that the phone was not installed on the same day and there were complaints and emails which are present on record. The company should be sued and Janet should get the benefit and virgin media has done breach of contract.

Learning Outcome 3

Task 3

Obligation of consideration alludes to the circumstances and connections which the law perceives as offering ascent to a lawful obligation to fare thee well. A disappointment to take such mind can bring about the respondent being at risk to pay harms to a gathering who is harmed or endures misfortune as a consequence of their rupture of obligation of forethought. Accordingly it is vital for the petitioner to build that the litigant owed them an obligation of forethought. The presence of an obligation of forethought relies on upon the kind of misfortune and distinctive legitimate tests apply to diverse misfortunes. This address considers the position in connection to individual damage and property harm.

In tort law, an obligation of consideration is a legitimate commitment which is forced on an individual obliging adherence to a standard of sensible forethought while performing any demonstrations that could predictably hurt others. It is the first component that must be built to continue with an activity in carelessness. The inquirer must have the capacity to demonstrate an obligation of forethought forced by law which the litigant has ruptured. Thus, rupturing an obligation may subject a single person to risk. The obligation of consideration may be forced by operation of law between people with no present immediate relationship (familial or contractual or generally), however in the end get related in some way, as characterized by normal law.

Obligation of consideration may be viewed as a formalization of the social get, the verifiable obligations held by people towards others inside public opinion. It is not a prerequisite that an obligation of consideration be characterized by law, however it will frequently create through the law of regular law.

There are a few crucial contrasts in the middle of agreement and tort laws. A standout amongst the most critical contrasts is the issue of assent. In an agreement, the gatherings must enter into the assertion intentionally and without being forced. In place for the agreement to be substantial, each one gathering must agree to the conclusion of the agreement as expressed in the report.

This implies that one gathering can’t drive the other to enter into the agreement without their assent. In this manner, harms in an agreement assert generally need to do with a mix-up or an error between the gatherings, since they are regularly mindful of what they managing in the agreement.

Then again, the cooperation in a tort is never focused around assent. Torts for the most part include an interruption by one gathering into the security, wellbeing, benefit, or protection of the victimized person. Truth be told, if the exploited person agrees to the tortious behavior, it can serve as a barrier that will keep them from recuperating harms.

This distinction concerning assent is reflected in the way that courts recompense harms. For contracts, the motivation behind a harms grant is to restore the gatherings to their position before the break happened. In a torts assert, the harms are normally honored to repay the victimized person for their misfortune. Correctional harms are some of the time honored in a tort suit so as to rebuff the respondent. Correctional harms are once in a while issued in an agreement claim.

Task 4

Nature of liability: Donoghue v Stevenson (1932)

The paramount key of the case is about the ‘neighbor rule’. Indeed, obviously there would be a risk of the manager’s boutique de Tam to Bony. Be that as it may whether ginger brew maker owes an obligation of consideration to Bony or not? The basic law obligation of consideration, ‘neighbor guideline’ states: Defendant owes an obligation of forethought to the neighbor’. Once more, who neighbor is; and the attention is clarified as: somebody who languishes over the harm brought about by an alternate party’s carelessness. So if Bony endured stun and extreme gastro-enteritis brought on by ginger brew maker’s carelessness, she is a neighbor of that producer. Thusly the producer was in charge of Bonny’s wounds.

Nature of Liability: Ryland’s v Fletcher (1868)

Risk under Ryland’s v Fletcher is currently viewed as a specific kind of irritation. It is a manifestation of strict obligation, in that the litigant may be subject without any careless direct on their part. Forcing risk without verification of carelessness is questionable and accordingly a prohibitive methodology has been brought as to obligation under Rylands v Fletcher. There have been endeavors to do away with risk under Ryland’s v Fletcher however the House of Lords have held it.


  • Collection on the litigant’s territory.
  • A thing prone to do fiendishness in the event that it escapes.
  • Escape.
  • Non-characteristic utilization of area.
  • The harm should not be excessively remote.

Nature of Liability: Bolton v Stone (1951)

On 9 August 1947, throughout a round of cricket against the Cheetham second XI at Cheetham Cricket Ground in Manchester, a batsman from the going to group hit the ball for six. The ball flew out of the ground, hitting the inquirer, Miss Stone, who was remaining outside her home in Cheetham Hill Road, more or less 100 yards from the batsman.

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The club had been playing cricket at the ground since 1864, preceding the street was inherent 1910. The ground was encompassed by a 12-foot (3.7 m) wall, yet the ground slanted up so the wall was 17 feet (5.2 m) over the level of the pitch where the ball passed, something like 78 yards (71 m) from the batsman. There was confirmation that a ball had been hit that far out of the ground just once in a while, something like six times in the most recent 30 years, despite the fact that individuals living closer to the ground reported that balls were hit out of the ground a couple times each one season.

The inquirer contended that the ball being hit so far even once was sufficient to give the club cautioning that there was a danger of harming a bystander, altering it with obligation in carelessness for the offended party’s wounds. The petitioner additionally guaranteed under the standard in Ryland’s v Fletcher, that the ball was a hazardous thing that had “gotten away” from the cricket ground, and in annoyance.

Task 5

Vicarious obligation is the procedure of considering an individual responsible for the movements of someone else. Regularly, the idea of vicarious obligation applies to executive risk for the movements of their workers.

Harmed people that wish to consider bosses responsible for the movements of their workers need to make three components:

  • The representative understanding obliged the worker to work under the bearing and control of the boss.
  • The boss had characteristic power to control the worker.
  • The representative’s movements are inside the extent of job.

The trouble of verification rests on the individual needing to consider a business responsible. In this manner, acquiring legitimate records about the extent of work is essential.

The tenet of vicarious obligation some of the time considers managers in charge of movements of their representatives whose activities were unforeseen. These include:

  • Boss had control over the representatives throughout work hours: Because the business had control over the activities of their workers they ought to be considered capable.
  • Boss profits from the movements of the worker: The representative gets benefits for the business. Hence, the superintendent ought to be in charge of any misfortunes.

Learning Outcome 4

Task 6

Case 1

  • The tort of Negligence says that if a person gets injured due to negligence of another person then the injured person must be compensated for the losses. As in this case, the manager cannot be held responsible for the injury of Paul. It is because he warned all the employees on intercom not to go there. He also instructed other employees to clean up the mess created. If was bad luck of Paul nothing else that he got injured and legally the manager cannot be held responsible for the injury of Paul.
  • According to vicarious liability, a person is held accountable for the injury of another person. Now in this case the manager cannot be held responsible for the injury of Paul because it was not his negligence. He tried his best to minimize the loss but it was bad luck of Paul that he got injured.

Case 2

  • As far as the situation of taking Paul to hospital is concerned, the driver was responsible for all the destruction caused. In this mishap Paul could have died or his injuries may have increased so Paul can sue the driver also. Both tort law and vicarious liability law supports Paul in this context.
  • Now coming toward the shop, it was due to negligence of the shop keeper that Paul was again injured so the shop keeper must be held accountable and according to tort law and vicarious liability the shopkeeper must be sued for his negligence.









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